Top Bull Pitch

Submitted June 19, 2016

These days it seems like I can't catch a break on a long and can't go wrong with a short. Who could blame me for being most interested in pessimistic commentary? The other day I saw a nice-looking takedown of a company that wasn't in my database and… More

These days it seems like I can't catch a break on a long and can't go wrong with a short. Who could blame me for being most interested in pessimistic commentary? The other day I saw a nice-looking takedown of a company that wasn't in my database and decided I'd red thumb first and research later.

The takedown can be found here https://www.scribd.com/doc/315865394/XBIT-Red-Flags-Uncovered-Avoid-at-All-Costs-Part-1-of-3

My reading of XBiotech press releases is that they're very high on the sleaze quotient. They're written in a very roundabout, overly conversational way that makes the actual point very hard to understand. There's also a lot of use of biotech buzzwords like "breakthrough", "novel", "unprecedented" that scammy outfits like to use to drum up excitement. I found the primary endpoint that XBiotech used in their European phase III trial to be very weird and "unprecedented". As biotechbbqbeats (ugh) emphasizes in his article, the OS data to be reported on July 2 will provide a much better assessment of whether Xilonix is a viable alternative for colorectal cancer.

The major issue that seems to be ignored in the short thesis is the apparent fact that EMA accepted the Xilonix MAA for some sort of accelerated review in April, which theoretically means the drug could be approved in September. I'd actually never heard of accelerated review for an MAA before, but apparently it's a thing. Either XBiotech management is lying even harder than generally considered acceptable for a biotech, or there's some real potential here. I figure I'll wait until July 2 before making up my mind about XBiotech.

I could see this stock going much much higher. They have a great pipeline with 15 potential drugs. And also have US FDA Fast Track designations for the treatment of colorectal cancer, which is currently in phase 3.